The TouchDroid project, which was supposed to produce a port of Android that can replace the webOS operating system on the HP TouchPad, is currently going through a bumpy ride.

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Yahoo! Newsreports that a member of the team working on the TouchDroid project has allegedly misused funds donated to the project and has allegedly misrepresented the group.

Thomas Sohmers, the project’s leader, told media that a member of his team used project funds to buy HP TouchPad units and resold the units for profit. The same team member also allegedly removed TouchDroid’s Twitter account and deleted files that are crucial to the project.

The said team member has denied all allegations. In the light of the issue, Sohmers has announced his plans to start anew with a team comprised of some of the original members.

The TouchDroid project’s initial goals were to first port Android 2.3 Gingerbread to the HP TouchPad, and then work on a port of Android 3.x Honeycomb, which is better-suited for tablet devices such as the HP TouchPad. Sohmers also indicated that the project will also start working on a port for Android 2.4/4.0 Ice Cream Sandwich once the source is made available.

People went on a mad scramble for HP TouchPad units when HP decided in mid-August to discontinue making webOS devices. The consequence of the announcement from HP was a massive dive of HP TouchPad prices: US$99 for the 16-gigabyte model (previously US$499) and US$149 for the 32-gigabyte model (previously US$599). Online retailers such as Amazon, Wal-Mart, Best Buy, and HP’s own online store reportedly sold out their existing stocks.